* Revenue of $2.4 billion for the quarter, down 2% sequentially and 38% year-over-year
* Operating losses were $321 million for the quarter, a sequential improvement of $249 million, or 44%
* GAAP net loss per share of $1.00 for the quarter includes $0.85 per share of adjusting items
* Cash flows from operating activities were $119 million for the quarter
North America
North America revenue of $674 million for the quarter increased 1% sequentially. The activity increase in the U.S. onshore and the seasonal uplift in Canada were almost entirely offset by a steep decline in activity in the Gulf of Mexico. Despite the increase in activity, the competitive landscape remains challenging across the entire segment.
Operating loss before tax for the third quarter was $65 million, a $246 million improvement compared to the prior quarter. The reduced losses were driven primarily by $158 million of inventory-related adjustments in the prior quarter not repeating, cost savings from recent restructuring actions, including lower depreciation and amortization expense from impairments, and a reduced provision for excess inventory. The current quarter also includes a $28 million benefit from non-recurring items.
Adjusted operating loss before tax (a non-GAAP measure), which excludes the inventory-related adjustments, was $74 million for the third quarter, a $79 million improvement compared to the $153 million in the prior quarter.
Latin America
Latin America revenue of $243 million increased 3% sequentially against the backdrop of a 2% rig count reduction. The increase in revenue was driven mainly by a one-time product sale in the Andean area, partially offset by reduced activity in the region, primarily in Venezuela and Mexico.
Operating profit before tax for the third quarter was $20 million, an increase of $263 million, compared to an operating loss before tax of $243 million in the prior quarter. The improvement in profitability is driven by $130 million of provisions for doubtful accounts and $88 million of inventory adjustments in the prior quarter not repeating, lower provision for excess inventory, and cost savings from restructuring actions, including reduced depreciation from impairments. The current quarter also includes a high-margin, one-time product sale in the Andean area and a $3 million benefit from non-recurring items.
Adjusted operating profit before tax (a non-GAAP measure), which excludes the inventory adjustments, was $16 million for the third quarter, a $171 million increase compared to the $155 million operating loss before tax in the prior quarter.
Europe/Africa/Russia Caspian
Europe/Africa/Russia Caspian revenue of $519 million for the quarter decreased 11% sequentially, primarily due to reduced activity and unfavorable exchange rates in West Africa and reduced activity in Norway, mainly as a result of project timing and labor union strikes.
Operating profit before tax for the third quarter was $22 million, an increase of $279 million compared to an operating loss before tax of $257 million in the prior quarter. Despite lower revenue, profitability improved sequentially, mainly as a result of $152 million of inventory adjustments and $58 million of valuation allowances on indirect taxes and provisions for doubtful accounts in the second quarter not repeating. The current quarter also includes cost savings from restructuring actions, including reduced depreciation and amortization expense, lower provision for excess inventory, and a $5 million benefit from non-recurring items.
Adjusted operating profit before tax (a non-GAAP measure), which excludes the inventory adjustments, was $13 million for the third quarter, a $118 million increase compared to the $105 million operating loss before tax in the prior quarter.
Middle East/Asia Pacific
Middle East/Asia Pacific revenue of $649 million for the quarter was relatively flat sequentially. Activity declines and price erosion across most of the segment were offset by pockets of activity growth, primarily in Saudi Arabia and Kuwait.
Operating profit before tax for the third quarter was $71 million, an increase in profitability of $213 million compared to operating loss before tax of $142 million in the prior quarter. Despite price deterioration, profitability improved as a result of $125 million of inventory adjustments in the prior quarter not repeating, cost savings from restructuring actions, including reduced depreciation and amortization expense, lower provision for excess inventory, and a $6 million benefit from non-recurring items.
Adjusted operating profit before tax (a non-GAAP measure), which excludes the inventory adjustments, was $63 million for the third quarter, an increase in profitability of $80 million compared to adjusted operating loss before tax of $17 million in the prior quarter.
Industrial Services
Industrial Services revenue of $268 million for the quarter decreased 2% sequentially. The decrease in revenue was mainly related to project delays in the pipeline inspection and maintenance business, causing an earlier-than-usual seasonal decline.
Operating profit before tax for the third quarter was $30 million, an increase of $73 million compared to operating loss before tax of $43 million in the prior quarter. The increase in profitability was driven by $47 million of inventory adjustments and $7 million of provisions for doubtful accounts in the second quarter not repeating. The current quarter also includes cost savings from restructuring actions, including reduced depreciation and amortization expense, lower provision for excess inventory, and a $3 million benefit from non-recurring items.
Adjusted operating profit before tax (a non-GAAP measure), which excludes the inventory adjustments, was $26 million, an improvement of $22 million compared to $4 million in the prior quarter.
http://www.oilvoice.com/n/Baker-Hughes-announces-third-quarter-2016-results-revenue-falls-to-24-billion/b9bd57f66cf1.aspx?utm_source=twitterfeed&utm_medium=twitter&utm_campaign=Feed%3A+OilvoiceHeadlines+%28OilVoice+Headlines%29BHI says 100 rigs have been added in Russia in past year